What are my right regarding a used car sale?

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What are my right regarding a used car sale?

I’m in the process of buying a car from a private party, making monthly payments. Now the car is having transmission problems and often smells like gas coming from the engine compartment. The seller had me sign a document he created stating that I, the buyer agree to take responsibility for any mechanical issues while I’m driving it. Little did I know that at the time of the initial transaction that the car would develop such serious issues that would run into such potentially costly repairs. By the way, this vehicle originally belonged to his mother, who is deceased, and the owner has not yet gone to the DMV for the title transfer, thus the car is not even in his name yet. Is the contract legally binding under the circumstances?

Asked on June 9, 2013 under Business Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

The contract would not be legally binding if he does not have title (except as indicated below): someone cannot legally sell what he does not own. A contract of sale under which A "sells" something he does not own is void for illegality or impossibility (the argument to void the contract could be framed either way).

The contract could be valid IF it is written as a contract that the person will make best efforts to get title and you will buy it from him if he gets the title--then the contract is written to accurately reflect the state of affairs, and if he can get title, you'd have to buy the car. (If he can't, then a  condition precedent for your performance would never had occured, and you'd be let out of your obligations.)

If the seller knew or reasonably should have known (that is, any reasonable seller in his position reasonably must have known) of the mechanical issues at the time you signed the document regarding responsibility for mechanical issues and he did not tell you of those problems, then he most likely committed fraud--a material misrepresentation, or important lie--which could give you grounds to rescind the transaction.


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